Core Viewpoint - Deere & Company is facing significant challenges due to a projected $1.2 billion tariff impact in fiscal 2026, which overshadows its recent earnings performance [1][2]. Financial Performance - Despite exceeding earnings estimates, Deere anticipates a decline in net income for fiscal 2026, projecting it to fall between $4.0 billion and $4.75 billion, down from over $5 billion in fiscal 2025 [2]. - The company reported a 30% decline in the North American large agriculture industry this year, yet managed to deliver margins that are over 450 basis points better than in 2016, the last comparable cycle [6]. Inventory and Cost Management - Deere has significantly reduced its inventory levels, with the inventory for its largest tractors reaching a 17-year low, indicating aggressive cost management in response to falling demand [4]. - The company is committed to inventory management and cost control to navigate the ongoing margin pressures from tariffs and challenges in the large agriculture sector [5]. Market Outlook - Executives view fiscal 2026 as a transitional year, suggesting that it may mark the bottom of the large agriculture cycle, while also indicating growth in other segments [5]. - Deere expects its construction and forestry business, along with its small agriculture and turf segment, to grow approximately 10% in fiscal 2026 [5]. Stock Performance - Year-to-date, Deere shares have increased by 12.36%, but this is lower than the S&P 500's return of 16.09% during the same period, with a minimal annual gain of 0.83% [6]. - Following the earnings report, Deere's stock fell by 5.67% to $469.87 per share [6].

Core Viewpoint - The farm equipment maker, Deer, anticipates annual profit to fall below estimates due to tariff impacts and reduced margins from large tractors [1] Group 1: Financial Performance - The recent quarter showed growth across all sectors, particularly in construction, which increased by 27% [2] - Deer expects a sales decline of 5% to 10% for the full year 2026, although this is an improvement compared to previous years where sales dropped by 17% in 2025 and 22% in 2024 [5] Group 2: Market Conditions - The farm economy remains volatile, leading to conservative guidance from Deer [2][5] - Bankruptcies among farmers in Iowa are increasing year on year, indicating stress in the agricultural sector [4] Group 3: Government and Policy Impact - There is potential relief for farmers expected to start in January, reminiscent of the $12 billion relief provided in 2018 [3] - Recent rollbacks on agricultural tariffs may also provide some relief to the farming community [4]

Leadership Changes - Deere & Company has announced key leadership changes to advance its Smart Industrial Strategy, focusing on intelligent and connected machines to enhance customer economic value [1] - John May, chairman and CEO, emphasized the importance of building a purpose-driven leadership team dedicated to customer success [2] New Appointments - Cory Reed has been appointed president of Lifecycle Solutions, Supply Management, and Customer Success, overseeing global aftermarket, customer support, supply chain, precision upgrade, and business transformation initiatives [2][8] - Justin Rose will take on the role of president for the Worldwide Agriculture & Turf Division: Small Agriculture and Turf, responsible for the Europe, Africa, and Asia markets [4][7] - Deanna Kovar has been named president of the Worldwide Agriculture & Turf Division: Production and Precision Ag, covering the Americas and Australia markets, focusing on major equipment and technology solutions for production-scale agriculture [5][6]

Core Viewpoint - Deere & Company has lowered its full-year guidance due to tariff uncertainty, cautious customer spending, and weaker crop prices, leading to a significant drop in stock price [3][5][9] Financial Performance - Third-quarter revenue increased to $15.2 billion, surpassing the $14.8 billion consensus, while earnings per share (EPS) reached $10.02 compared to the expected $9.57 [4] - The stock price is currently at $480.02, down 6.53% [3] Guidance and Market Reaction - The company forecasts weakness across all business units and regions, attributing this to tariffs and reduced equipment demand [5][6] - Deere expects reciprocal tariffs and higher steel costs to decrease pretax results by approximately $700 million, with about half of this impact occurring in the current quarter [5][6] Inventory and Demand - Deere has reduced large tractor inventories by 45%, small tractors by 30%, and earthmoving units by 25%-30% due to slower equipment demand [6] - Customers are increasingly opting for used equipment, which is creating headwinds for new equipment sales [6] Crop Prices Impact - Declining crop prices, particularly for corn, wheat, and soybeans, are at multi-year lows, leading farmers to defer purchases of new equipment [7] Analyst Ratings and Stock Forecast - The 12-month stock price forecast for Deere is $523.93, indicating a potential upside of 9.34% based on 20 analyst ratings [7] - The stock is currently rated as a Moderate Buy, although it is not included in the list of top recommended stocks by leading analysts [14] Valuation and Technical Outlook - Deere's stock trades at around 23x earnings and 26x forward earnings, which is a premium to its historical average but not overvalued relative to the broader sector [11] - The stock has fallen below its 50-day simple moving average, suggesting potential further declines in the short term [11][13]